by Kate Incontrera
Life imitates art…or at least a made-for-TV movie…
BP reported late Monday that one of its deepwater oilrigs is listing badly after Hurricane Dennis, a category 4 hurricane, blew through their oil and gas field, located almost 200 miles southeast of New Orleans.
Does this situation sound familiar? In The Daily Reckoning’s most recent weekend edition (http://dailyreckoning.com/Issues/2005/DR070905.html), we looked at “Oil Storm,” an FX made-for-TV movie. This “mock-umentary” looks at a series of worst-case scenarios, one being a category four hurricane destroys a vital pipeline in the Gulf of Mexico, driving oil prices up to, at one point, $153 a barrel.
What’s happening with Hurricane Dennis is not quite at the level of the disasters that ensued in “Oil Storm,” but the storm did force the evacuation of 445 rigs and platforms, according to a report from the U.S. Minerals Management Service.
The report went on to say, “The evacuations prompted the shut-in of 96.2% of daily oil production in the Gulf of Mexico, as well as 62.4% of daily natural-gas production.”
Kevin Kerr told MarketWatch: ” [Although] workers should be returning to their rigs and platforms and production should resume pretty quickly, we are only at the start of hurricane season, so the worst may be yet to come for the Gulf Coast. The potential for a catastrophic hurricane is very high.”
“Imagine if this were a category 5 hurricane. This was only a minor hit… the Daily Reckoning article and FX TV movie are more realistic than some want to say.”